ImmunoCellular: Is Approval Enough?

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IMUC has failed to meet its primary endpoint in the Phase 2 trials of its lead product ICT-107 and is in talks with the FDA regarding the continuation of the product in Phase 3. ICT-107 is comparable to Northwest's (NASDAQ:NWBO) DCVax-L and is perceived as the same by many investors.


ImmunoCellular Therapeutics, Ltd. (NYSEMKT:IMUC) Is a clinical-stage biotechnology company that discovers and develops immunotherapy vaccines for the treatment of brain, ovarian and other solid tumor cancers. The company uses a sophisticated knowledge of cancer biology and genetics of the immune response to develop a vaccine that is quite different from and more effective than the conventional vaccinations available for cancer. ImmunoCellular's propriety technology utilizes dendritic cells, which are responsible for antigen processing and presentation to the immune system and help in stimulating a powerful immune response that can destroy cancer cells and prevent tumor recurrence.


  1. ICT-107 is the company's lead candidate in Phase 2 which targets glioblastoma multiforme ((GBM)) through six different antigens via dendritic cells.
  2. ICT-140, a dendritic cell vaccine in Phase 1 being developed to target ovarian cancer cells.
  3. ICT-121, a Phase 1 candidate being developed for recurrent glioblastoma multiforme ((GBM)). This vaccine targets CD133, an important cancer stem cell maker that is commonly expressed on a broad range of solid tumors.

Glioblastoma Multiforme ((GBM))

GBM is a fast growing type of brain tumor and is the most common tumor in adults. GBM is mostly found in adults between the ages of 45-70 years. Overall, the patients with GBM survive not more than 15 months after the initial diagnosis. Normally the patients receive the standard care treatment, which includes brain surgery and removing a growing brain tumor. This is followed by the patient undergoing radiotherapy or chemotherapy, or even both. The decision rests with the doctors, i.e. the neuro-oncologists. It has also been observed that GBM's recurrence is inevitable after a median survival time of six to seven months.

PHASE 1 Trial Outcome of ICT-107

Standard of Care Treatment



Median Progression Free Survival (months)




Median Overall Survival (months)




Three Year Survival




PHASE 2 Trial Outcome of ICT-107

Description of the Trial

The trial consisted of 124 patients with newly diagnosed GBM whose tumor had been surgically resected. The trial was randomized with one third (43 patients) of the population receiving only standard of care, which is surgery followed by radiation and the cancer drug temozolomide (chemotherapy). The other two-third (81 patients) received standard of care plus ICT-107. The primary endpoint of the trial was an improvement of 9 months in the median overall survival rate and a key secondary end point was the median progression free survival (the time when the cancer starts to grow again)


The Phase 2 trial results were announced on Dec 11, 2013 and were disappointing as they did not reach the specified end point of a 9 month improvement in median overall survival rate. The results showed only 2 months of improvement based on an intent to treat all 124 patients enrolled in the trial and 3 months improvement based on a per protocol analysis of 117 patients. These, however, were Kaplan-Meier estimates and could increase as the data matures.

Will Phase 3 be Approved?

ImmunoCellular believes that the results shown by ICT-107 are promising and that the drug has the potential to be taken into Phase 3 for extensive testing. However, before going for Phase 3 the company will need time to go over the trial data and allow it to mature in order to see whether the median overall survival rate improves as the number of deaths increases from 67 to 124.

Temozolomide was approved by the FDA because it showed a 2.5 months improvement in the median overall survival rate by increasing the rate from 12.1 months to 14.6 months. We believe that as the Phase 2 data of ICT-107 matures the overall median survival rate will increase to around 4-5 months, increasing its chances for approval. However, even if there is no improvement as the data matures it has shown 2-3 moths of improvement which should be enough for the FDA to approve Phase 3 trails.

ICT-107 (IMUC) or DCVax-L (NWBO)

ICT-107 and DCVax-L are often compared to each other and the market tends to perceive both drugs as the same. For that reason ICT-107's Phase 2 results also affected the share price of Northwest because investors perceived both the products as a failure in terms of effectiveness in the treatment of cancer and assumed that the Phase 3 trial of DCVax-L will also produce disappointing results.

Both companies use the same means (dendritic cells) to attack cancer cells. Activated dendritic cells are removed from the patient's body and filled with antigens from the patient's own cancer site. The antigen-filled dendritic cells are placed in the body again where they alarm the other agents in the immune system (including T-cells, B cells, NK cells and others) to attack the pathogen/tumor.

Though the means are the same, both drugs are quite different in their approach in targeting the cancer cells. DCVax-L exposes the dendritic cells to the full set of antigens that could possibly be found on the cancer of any patient. On the other hand ICT-107 uses the peptide fragments of 6 preselected antigens that are mostly found on the cancer cells. This raises an issue when using ICT-107 in patients because it addresses just a small fraction of antigens whereas there are hundreds of antigens on each cancer cell. However, ICT-107 also targets cancer stem cells which are responsible for recurrence of the cancer.

ICT-107 can only work in a certain immune type (HLA A1 and A2 Positive) and does not cater the entire GBM population. DCVax-L on the other hand has no such limitation and can target any type of immune system, covering the entire population of GBM patients. According to ImmunoCellular 75% of potential patients are HLA A1 and A2 positive, however the recent phase 2 results have shown that out of 278 patients enrolled there were 132 patients with HLA A1 and A2 positive status; only 46% of total patients. Even if the overall patient population does contain 75% positive status as stated by the company, we believe that it is missing out on a major set of patients left untreated by ICT-107, leading to a much smaller market when compared with DCVax-L.

The manufacturing process of both drugs is also different and can produce very different type of dendritic cells. Manufacturing of ICT-107 is standardized as compared to the more customized manufacturing of DCVax-L. In ICT-107, there are six predefined antigens that are widely expressed in GBM. On the other hand, Northwest uses a tumor lysate to obtain antigens for vaccines. When the surgeon removes the tumor, the piece is analyzed after which the antigens present in the tumor as well as in the cancer stem cells are filled in the dendritic cells which are then injected back in the patient's body in order to initiate treatment. This process is more effective as it targets the entire antigens specific to every patient and the FDA has recently approved Northwest's manufacturing sites, providing it an edge over ImmunoCellular. Both these drugs are cryopreserved and shipped to patients, allowing better and long-term storage and lower manufacturing costs.

DCVax-L is also manufactured by Northwest's sister company Cognate Bioservices which has a long experience in living cell manufacturing. Northwest has an added advantage over ImmunoCellular because of its collaborations with King's College in England and Fraunhofer in Germany; both institutions have expertise in the development of innovative medical treatments with advanced manufacturing sites that are devoted for the development of DCVax-L. This will provide Northwest with a profound advantage over ImmunoCellular in Europe as both institutions will garner credibility and support for clinical trials in the region and stimulate the drug's approval.

More differences will come into play as clinical data is developed. However, till now DCVax-L has certainly shown more potential than its rival drug ICT-107 because of its superior approach in targeting the cancer cells. These products could also be used in sequence or combination to improve results, which normally happens in cancer therapies.

Financial Performance

Cash Burn Rate

Account Type

Q3:13 ($)

Q2:13 ($)


Cash & Cash Equivalents

29.4 million

25.4 million

24.1 million

Total Cash From Operating Activities

1.9 million

1.91 million

2.207 million

Average Cash Burn Rate (Three quarters)

$0.67 million per month


3.6 years or till mid-2017

We do not expect the company to dilute in the year to come, however we expect that the cash burn rate will increase as ICT-107 will certainly proceed to Phase 3 trials; with other candidate trials proceeding as well.

Risk of Investment

Due to uncertainty regarding the success of ICT-107, investors should take into consideration that biotechnology stocks are mostly valued on the potential of the drug in the future and any announcements regarding ICT-107's failure in the future can result in a huge decrease in stock price; in other words the downside risk in this company is very high.

Small-cap companies can also suffer from insufficient cash balances to support their clinical trials when they are in the phase of developing candidates, like ImmunoCellular. These companies normally raise money through dilution and investors should expect a sharp decrease in the share price when dilution happens. On the other hand it may be possible that ImmunoCellular is unable to raise money through dilution or debt because the investing party does not expect the candidate to be a profitable investment; this can result in company going bankrupt. In case of bankruptcy, investors will be unable to realize their investment in full as these companies have very low salvage value in comparison to their current market capitalization.


ImmunoCellular is going through a bad phase with trial results not going as expected, falling share prices and negative investor perception of the drug but it may have the potential to beat the odds because its performance is better than standard of care treatment. As Phase 2 data matures there will be an improvement in the overall median survival. We expect that with even these unfavorable results, ImmunoCellular may get its candidate approved. However with the uncertainty regarding its drug's potential to be a blockbuster, we recommend a neutral position on the stock.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Equity Flux is a team of analysts. This article was written by our Healthcare analyst. We did not receive compensation for this article (other than from Seeking Alpha), and we have no business relationship with any company whose stock is mentioned in this article.